Scattered postings from a hitchhiker's travel journal

The journey; on the road to the digital networked society

Darwinism goes digital: Italian marketing goes digital, but if it’s about survival of the fittest then we're in for some species shake out

"It's not the strongest or most intelligent species that survive; it is the one most adaptable to change" - you have to love Darwin, he gets to be relevant zillions of times and spaces away from Origin of Species. But what does 'adaptable' mean for species 'corporation-corporatus- Italian'?

Try this: web marketing is now becoming core in the client's mix of media here in Italy. Not for all clients, yet, but for many, for the ones with the smart marketing folk. The dramatic shift in audience behaviour during the last few years is finally being followed by a shift in advertising's focus. It's crude to simply use adspend as a way of tracking how firms think, but it works pretty well. And almost 3% (2.8% summer 2005) of that adspend is already online. In context that's a level about average for the European Union right now, but well behind the US (just under 5%) and the UK (probably just crossing 6%).

But dig deeper and there's a different truth: leading firms taking this seriously are investing ten times more in online than their rivals. Paolo Duranti runs the Nielsen's Media Research business and is tracking online ad spend in Italy. He's a good guy to know because he knows about what a lot of guys here are doing.

"Sure, total online advertising spend is rising, and it's continuing to rise at a fast rate". Cool: same pattern pretty much everywhere these days. "But what's really interesting is the massive difference between firms that have embraced online, and those that have not even started". Now I'm getting interested.

"Some firms - large and small - put more than half their advertising budgets into internet media. Others - including some of the largest brands in Italy - are yet to do more than put a small token spend into online alongside their classical media advertising". I can tell he's being polite here because he's got stacks of charts that prove the situation for many is even worse: they're doing absolutely nothing at all! The charts show, for dozens of brands, roughly what they're spending on TV, radio, the web and pretty much every media. The results are staggering.

These are not minor differences (a few percent here, a few there), these are extremes so wild they're defying belief. Brand one: zero. Brand two: zero. Brand 3: 40%.

Enter Darwin.

This ecosystem is changing, and it's changing dauntingly fast. So fast it puts real strain on the ability to adapt. All those of us caught up in it are responding in our own ways, but some are much faster than others (for example I guess that includes you and I, since I'm writing a blog and you read blogs). The variation of scale in these responses is huge. Those organizations adapting well to the new landscape have found new ways and changed their culture to institutionalize that adaptation. Those who are not are like Darwin's organisms that just disappeared because they couldn't survive any more.

Think about what that means. Rapid change in the ecosystem, adaptation at hyper-speed, the explosive growth of a handful of new species. And it's here, in front of us.

But what about the flipside? Those failing to change? Now the last time I stumbled through any Darwin was back at college, which is far enough to be getting fogged up at the edges, but I'm sure that those who didn't adapt didn't simply decline 'a little'. They were wiped out of existence, right?!

And on Paolo's charts in front of me is the DNA of a firms adaptability. It's right here! Sure it's a horridly crude index, sure it ignores a bunch of key dynamics, but it's a basic ranking the adaptability of all Italy's corporate creatures. Whoa! What does it show? Well, at the top we have EBay, Amazon, Dell and the usual suspects - probably a bunch of websites you'll find in your own cookies folder. And down at the bottom there's a bunch of huge names, massive brands from the traditional world.

. Are these firms really heading for extinction?. Can firms change their DNA to make themselves more adaptable?. Was Darwin wrong?. How massive is the species shift we're heading for?. How do you institutionalize adaptability?

My brain's whirring about all over the place; you take this to its conclusion and you have the ice-age! Half the species end up fossilized in the archaeology of corporate history. This is as fantastic as it is terrifying.

Milestones

Broadband battle with US UK penetration of fast broadband connections slips ahead of US for first time.

Silver surfers swell Almost two out of every three of those coming up to retirement in the UK are online; double where the UK was in just 2001

9% of China online And with vast growth rates to match it's not hard to understand why every dot com is looking East right now.

Blogtastic 1 new blog created every second as blogging goes mainstream.

The magic billion Crossing the threshold of '1 billion people' now online worldwide.

Beethoven rocks the house 1.3m downloads of Beethoven tracks, making him 1-9 in the download chart. Thanks to BBC Online the stereotype of music being just for kids gets blown apart.

Ebay addicts More than £4bn traded on eBay here this year, accounting for 1.3% of UK sales and an average of £3,000 per trader; latest news – the tax man’s interested in a slice!

Broadband Britain Finally broadband home access outweighs dial-up, but spare a thought for the poor folks still on dial up.

Navigators

"The future of advertising is the internet"Bill Gates 27/10/05

"It is happening now and is strong, rapid and large. [And there’s a] tremendous violence in traditional media as it continues to get displaced by digital."Sir Martin Sorrell, 27/10/05

"What is happening is a revolution in the way young people access news. Unless we awaken to these changes, which are quite different to those of 5 or 6 years ago, we will, as an industry, be relegated to the status of also-rans."Rupert Murdoch, American Society of Newspaper Editors, 13/04/05

Smallprint

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